Original Whitepaper can be found here:
eCommerce is currently the largest market in terms of product sales across the globe. Firms such as Amazon, eBay, Aliexpress, Noon.com, Cdiscount, Allegro, and many others all contribute for huge sales across countries and abroad. Each have grown from humble beginnings where technology was the key factor in progress. In each instance, technology in combination with a form of delivery such as the postal service/courier were used to create this new market that expanded rapidly and became very popular during early 2000s and onwards. Previously simple classified ads were at the forefront where buyers and sellers would meet personally and collect items. This has become increasingly popular again recently since Facebook began developing the marketplace platform which offers a free service for collection between two parties where Facebook primarily relies on the person credible history such as friends and group histories. Facebook is increasingly moving to include the possibility of using diem crypto currency in the future which can also act a disrupter in the development of more merchants online as more sellers are moving forward in opening their own websites using platforms such as shopify.
However in each of these cases blockchain is not being used and it would also make little sense to do so since blockchain technology would not really put any of these sites in additional favour as their platforms are saturated and well developed. For example, eBay can easily integrate Ethereum payments into its platform if it needs with any partnership with cryptocurrency.
The question we ask is it possible to develop a more unique platform where products can be sold using blockchain technology that is in a unique form, a marketplace that has zero competition and has never before been developed such in a way that bitcoin was first invented and grew.
1.) What is the problem.
Bitcoin was the disruption of currency that was created from a centralised monetary policy governed by governments across the world. Due to its unknown foundations, it quickly grew because people liked the idea of being able to trade the currency and remain anonymous.
In our case, we have a centralised postal service which is audited and checked by customs which uses extremely large custom fees and delivery costs that would cost a fortune to send high valuable products from one country to another.
So, our problem is, is it possible to develop a service where two individuals that are located anywhere around the world can trade products and cryptocurrency online where no postal service is used and is managed directly between a decentralised platform where only information such as items and cost is shared and no other information is required from each other. This is not the same as a classified product which you would buy between 2 facebook sellers as information between each other has already been shared such as name, where person A or B is located and other information including photographs.
Our requirement is simply to “enable 2 individuals to mutually agree on a cryptocurrency price between each other for a product which must be traded abroad or during a holiday/vacation”. It is not designed to be used for trading between 2 individuals in the same area within a small distance because there are many platforms that do this.
This is a project which benefits blockchain technology because it allows trade on an international level, to include countries where individuals are not able to afford products that would be easily available to them were they in another country. It is a project allowing well off and poorer individuals to be able to gain a product which they cannot afford in their own country perhaps because the product is not available or is too expensive.
Let’s take the following example.
I am nearing to the end of my phone contract. This “obsolete” phone is no use to me as I will be provided with a new one with my service provider. I can now sell this phone out of contract online such as eBay or Amazon and I will get a value for this phone according to the price which it is currently being sold for.
However, this price could actually be more in a foreign rich country where the demand is higher i.e. UAE OR it’s could be less in a poorer country but you are providing your own form of charity to help someone who is in need of a product that they could not afford, therefore helping communities that would never have been able to have access to such products. It does not necessarily mean that I have to offer a prestige product, I could have a product such as an old laptop or an old phone which has no value whatsoever, to the point that it may as well be disposed of. Perhaps it has value to someone abroad where they would take this for granted. As the saying goes “One man’s trash is another man’s treasure”.
2.) How big is the market and who are our competitors?
The market for such a project is virtually unheard of. There is no market like this project’s proposal. Just like AirBNB and Uber, each of these became disruptive because of decentralised possibility of “removing the middleman”. In our case it’s the extremely expensive postal costs.
There is no service from what I know that can allow you to take advantage of your baggage that you can use to take a product with you to resell abroad. This means that you are able to provide a product that is not dependent on size and weight to a limit (i.e. baggage allowance).
This market has the potential to grow exponentially with the combination of blockchain technology which would pioneer the security aspect of the sale and trade.
If we compare this to the international trade market, we are looking into the billions of dollars which is being paid to competitors such as USPS, UPS, DHL and other major couriers. In 2020, the pandemic allowed these companies to profit even more as prices began to rise due to limited availability and scare flights. (There was also the demand for PPE which caused unprecedented delays for other products which would have otherwise been delivered on time.)
Other competitors include larger eCommerce sites such as eBay and Amazon. These competitors must rely on the costs incurred by the delivery agents such as couriers. Amazon has indeed created its own shipping platform, however that too is heavily charged and custom fees are incurred for anything which is bought. In some cases, amazon shipping can actually charge more than 50% of the actual price of the goods due to inbound tax liabilities.
3.) The solution
This is by far the most interesting aspect of our project. We now have blockchain technology being developed in its early form. With the use of Defi services such as Metamask and Trust Wallet, we can hold funds directly on our device and be able to create tokens that are enabled to be smart contracts. Each seller can be given their own contract address on the cloe network. This is an important feature because once the contract has been created the blockchain will hold all feedback from 2 parties about the products that have been sold. It can also be used to create feedback left by both parties that show how reliable each were. The feedback can never be changed unlike eBay and amazon.
The portal for developing such a site would need to be split into two. One portal will be for sellers and another for buyers. In the seller portal we have the following:
The Seller Portal
1.) A “Skyscanner” flight schedule showing when the seller is looking to go on holiday. The seller can enter the date of arrival in a particular city (not country) and they simply moved onto the next page.
2.) The second page will allow the seller to provide information or photographs of the products that they have which they want to sell. Due to language barriers, we do not expect individual to leave much text, however we can use google to translate the text into a foreign language if necessary. The seller can leave as many products as possible they have on the site and allow bids for anything they have. They could take this one step further and allocate products that are demand in the foreign country for example in China the demand for baby milk became so popular that prices exceeded more than 4x.
3.) The seller then offers bids for these products which will be explained in the buyer portal.
4.) The information is transmitted onto a blockchain wallet where that data is stored and can be accessed from a dapp product. Therefore, a website is not required as the information is stored on a blockchain. Multiple websites can be used to connect the blockchain cloe wallet.
The Buyer Portal
Using the Trust Wallet example, the blockchain is connected to any “defi” website where the information stored is downloaded. Once connected the buyer can do the following:
1.) The buyer has the option to select the country they live in and then be more precise by clicking onto the city. The wallet will have blockchain categories which include every single city in the world. If a city does not exist, then it can be created manually and checked by a cloe admin.
2.) Once the buyer has selected the city, they can proceed to look at all the “incoming” products made available to them according to the schedule of flights, for example, a seller is arriving to Delhi on the 21st of December 2021. This flight could be well in advanced, however there would be optimal opportunities for bidding as during this time the seller will be offered many different bids and they are welcome to cancel it if they want, however if the bids becoming interesting higher the seller will be happy to complete the transaction because the product may be tax free. Furthermore, it means the payment received will be in their favour because they will be able to use this money abroad should they want to exchange it into another currency or simply keep it as an investment which they could not do unless they bought the token from an exchange.
3.) As the seller begins to receive more bids, they can then be in a position to formally award their buyer the product in advance. Unlike eBay feedback where the seller’s feedback is paramount, this is reversed because now it is the buyers feedback which is paramount. As the seller can choose for example from 5 different buyers. In each case, the seller can locate their feedback and determine which one is more reliable. The buyer can leave one form of message to make their offer why they should be chosen which is allocated on the blockchain. The seller could accept a lower bid from a buyer that has more feedback because they will look more reliable or take the risk of a higher price but from a buyer with no feedback.
4.) As the bids are confirmed between the two parties, the seller then creates a payment deposit which they must purchase cloe tokens in order to facilitate the purchase. The same applies to the buyer. Both parties will now have their funds locked as in the same protocol when money is cold staked. They cannot access this fund until the date of arrival. Sellers are required to pay a deposit which can be minimal in order that they do not back out. The same applies with the buyer. Depending on the Devs recommendation, the amount deposited will need to be calculated in either the buyer providing the full payment upfront or a partial payment which needs to be further examined. However, as it stands the contract has been confirmed and can now move forward.
5.) Should the buyer or seller agree to cancel they can however fees should be charged against the party that wishes to cancel and those fees should be used to either compensate the other party or being used to enhance the projects performance such as people working on the project.
6.) On the date of arrival, the seller and buyer will now need to meet up in a secure location. This is a part which requires further intervention. Currently we have little information on how this can be achieved, it is a problem which we will highlight at the end of the chapter.
However, there are certain methods which can be used to facilitate this.
We can Google maps to locate a location such as shopping malls or other busy places. If this is not secure enough then other cloe holders can intervene to become the mediator and they will receive cloe in return for this facilitation. They would be picked randomly according to their blockchain feedback. If they are not willing to accept, another random cloe holder is picked until one is accepted and they deposit cloe in which they will receive a reward for facilitating the transfer. This approach means that if one party backs out from the other then it will be decided by the cloe mediator who should be penalised. If the cloe mediator backs out that will impact their feedback or reward as well. All locations must be randomly delivered which are in busy areas and close to the mediator and other two parties to a certain distance. This should be developed by devs with further enhancements.
7.) If the trade goes well, all individuals will receive awards and payments in cloe. Product will be inspected by the buyer and tested allowing the buyer X minutes to decide. If buyers backs out then both parties are penalised because there was no agreement. The mediator can decide who should be penalised with proof.
This project has a huge potential just like Bitcoin had originally. It may as well be the first form of development where blockchain can be adopted and used in a new manner that could not happen before. However, because everything is anonymous we will find problems that need to be improved on.
1.) Vulnerable people doing the trade?
We will not have information about who the person is doing the trade. Therefore, we must include some form of notice that the person doing the trade must be cautious. It could be a woman that is alone meeting two men. Should the software be able to do trades between the same sexes or include a notification that this person should not travel alone. Meeting in a busy environment will mitigate these risks. The mediator can also be an employee or owner of one of these busy locations so that there is reliability. How could the blockchain know this? Further information is required.
2.) How can we ensure the trader is not a thief who will try to steal the product? Again, this is tricky as no information can be provided by new buyers. A buyer in a poor country may adversely try to steal the item and instead to a setup to maliciously attack the buyer and take their possessions. Being located in a busy environment and a third person mediator will mitigate these risks. Could we further enhance this? Can we force new buyers to pay a higher cloe payment which may be the full upfront cost, and this will be reduced as their feedback is improved? This will help the demand for cloe token to increase dramatically.
3.) Backing out in the last minute due to unforeseen circumstances.
Buyers and Sellers can back out before the trade goes ahead but what would happen if the buyer or seller backs out within the last 24 hours when the trade is set to go through or they are already in the same country, or for some reason due to transport issues they cannot meet at the location for any given reason? Should they be penalised where both mediator and second person agree there was no turn out and they would receive some compensation in cloe for their involvement and the buyer or the seller receives a refund minus fees paid to the mediator and the other person? Or could it be rearranged later perhaps within short noticed where both other parties can accept. Or should the mediator not be involved at all and both parties can meet at another busy location? Further information is required.
4.) How long to confirm a transaction? Cloe platform must be fast at confirming the transaction so that all parties can proceed with their other duties.
5.) Malicious method to smuggle products. In order that the blockchain stays secure, there should be no method between the two parties where the buyer encourages the seller to bring or purchase an item that they did not intend to do so. For example, there is no method that will cause the buyer to force the seller to bring illegal products or tricked into bringing a product that contains hidden illegal contents i.e. drugs, arms. This cannot happen if the only information shared is contract addresses. Images provided by the buyer should show only what products they can bring, and the buyer has no method whatsoever to contaminate this.
6.) Buyers pretending to be from abroad but are in fact located in the same country or city.
We want to create an international platform for International buyers and not people who will abuse the system to sell items in their own country/city or causing other unknown issues. There may be no issue for two people to meet up in the same location should they want to purchase a product but then why not used other eCommerce platforms such as eBay, Amazon etc where the price maybe different or cheaper? We want to offer two different individuals the chance to buy a second hand product which CANNOT be found in their city or country such as obsolete electronics. We may have the problem that buyers are simply not interested in other peoples old products so why should they buy? For this reason to create a more rewarding platform we can developed a third portal which can be the “trending list” where cities can acknowledge products that ate in demand by most views so people in other countries can decide if its worth buying from their local super market to sell them abroad and developing a unique platform where products can be delivered. Again no communication between both parties.
In conclusion to this project, we have several key factors that will enhance the cloe platform. We will have a unique form of delivery which can be fully utilized on the now developing callisto network that unlike other blockchains can move forward and develop into a brand as more users understand the concept. This will therefore lead to an increase in the purchase of cloe tokens whether from an exchange or purchased individually. The best concepts that work are word of mouth and as cloe grows more projects that become successful will only be able to achieve this by developing true decentralised solutions.
There is also the possibility that in the next 12 months there is a possible crash in the cryptocurrency markets, just like when the dot.com burst this may occur in some form within the next few years. Only those pioneering and life changing projects will survive, with those tokens that have no feasibility will likely die off.
What is certain is the simplicity and concept of this project is easy to translate in any language. Product traded abroad have the advantage of ZERO delivery costs, Zero Fees (except Cloe), and increase availability of products which could not be found elsewhere. It allows one to conduct more than one form of business should they have more interested parties subject to custom checks at airports to be able to develop unique business proposals which could not have been done otherwise. It allows to create a true nature of trust as people’s credibility is rated.